VIJAY KUMAR MILLS LTD Vs. ICICI BANK

JUDGEMENT

(1.) This writ petition challenges the order of AAIFR dated 21st February,2007, dismissing the appeal preferred by the petitioner on the ground of limitation. The order of the BIFR confirmed its earlier order dated 2nd January, 2002 to wind up the company under Section 20(1) of the Sick Industrial Companies (Special Provisions) Act (hereinafter referred to as the SICA) and further directed that the opinion be forwarded to the concerned High Court for necessary action in accordance with law. The Company was also restrained under Section 22(b) of SICA, from disposing of or alienating any of its fixed assets and current assets without specific prior approval of the BIFR and the charge holders until the appointment of an Official Liquidator by the concerned High Court.

(2.) In the order challenged in appeal, dated 4th March, 2004, the BIFR noted that subsequent to the order dated 2nd January, 2002, giving the last opportunity to the promoters, the company had not submitted any rehabilitation proposal till that date and had also failed to comply with the direction of the Madras High Court regarding deposit of Rs. 1 crore, resulting in the vacation of the interim order in the Madras High Court.

(3.) The company s stand before the BIFR was that no scheme of rehabilitation was submitted as the Manging Director of the company had been in on going negotiations with the banks and financial institutions to arrive at a negotiated settlement and failure of negotiations was the cause of not submitting the rehabilitation scheme by the company. The ICICI submitted that no negotiations had been held by the Managing Director of the company for arriving at a settlement of dues and even the associate companies of the petitioner company namely Kongar Integrated Fibres Ltd. And Kongrar Textiles Ltd. had also been ordered to be wound up by the BIFR. Consequently, upon the following reasoning in the concluding paragraphs, the BIFR by order dated 4th March, 2004, held as follows: